The2keyconsiderationsinretentionandseparation

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: quent violations of rules / procedures Frequent mistakes in work Does not support corporate values / objectives Linking HR Strategy with Linking HR Strategy with Retention & Separation On the next slide we re­visit the 4 dominant HR strategies and align them with key considerations in retention and separation. The 2 key considerations in retention and separation strategy are Labor Orientation (employees are either developed and promoted from within or hired from outside). And Business Strategy (Cost Leadership or Differentiation) Bargain Laborer External/Cost HR Strategy Low emphasis on retaining high performers & Low emphasis on removing low performers Loyal Soldier Internal/Cost HR Strategy Internal LABOR ORIENTATION External Strategic Retention & Separation Strategic Retention & Separation High emphasis on retaining high performers and low emphasis on removing low performers Free Agent External/Differentiation HR Strategy Low emphasis on retaining high performers and high emphasis on removing low performers Committed Expert Internal/Differentiation HR Strategy High emphasis on retaining high performers and high emphasis on removing low performers Cost Leadership Differentiation BUSINESS STRATEGY Reducing Unwanted Turnover Reducing Unwanted Turnover Not all turnover is bad. In fact, some turnover (up to about 5% per annum) is desirable. Turnover allows new people with fresh ideas to enter an organization. Turnover is bad when it is too high or when it is the good employees who are leaving. Retention can either be FUNCTIONAL or DYSFUNCTIONAL. Also, Separation can either be FUNCTIONAL or DYSFUNCTIONAL… Employee chooses to stay Employee chooses to leave EMPLOYEE CHOICES Types of Employee Retention Types of Employee Retention and Separation Desirable Employee Remains with Organization Undesirable Employee Remains with Organization Functional Retention Dysfunctional Retention Desirable Employee Quits Undesirable Employee Quits Dysfunctional Turnover Functional Turnover High performance EMPLOYEE CONTRIBUTION Low performance Conduct a Retention Audit Conduct a Retention Audit To reduce the loss of great employees, organizations need to take a strategic and planned approach to the problem. They can do this by conducting a Retention Audit. There are 4 steps to a Retention Audit: Costing staff turnover Knowing why people leave Keeping people through good “people policies” Managing new recruits Conduct a retention audit Conduct a retention audit Why bother conducting a retention audit: • To discover how much undesirable turnover is costing the organization. • To discover the extent of your undesirable turnover problem. • To show the organization that turnover is everybody’s concern, not just HR. • To have data on which to devise and target tailored retention strategies. Conduct a retention audit Conduct a retention audit Step 1: Costing staff turnover • The US Department of Labor estimates that it costs 1/3 of a new hire’s annual salary to replace them. • Others say that the cost of turnover depends upon the job and ranges from 0.5 through to 2.5 times the annual salary of the job in question. • The Saratoga Institute Turnover Costing Model estimates that turnover costs are between 1 and 2 times the person’s annual salary. Conduct a retention audit Conduct a retention audit Step 1: Costing staff turnover – what are the costs? Cost of termination (including pay-out arran...
View Full Document

Ask a homework question - tutors are online